Uber has taken yet another important step in streamlining its business amid concerns over its growing losses. The San Francisco based ride-hailing giant on Tuesday handed pink slips to as many as 435 employees from its products and engineering teams.
Among the laid off employees, sources claim that almost 85% employees emanate from the U.S. market, 10% from Asia pacific and 5% from European, Middle Eastern and African countries. These layoffs have come closely on the heels off company’s recent decision to lay off 400 employees from its marketing team.
The latest lay off constitutes roughly 8% of Uber’s global product and engineering team.
In a message to laid off employees, which was viewed by The New York Times, Uber’s CEO Dara Khosrowshahi said in a bid to grow rapidly the company had expanded too aggressively and now must streamline its business to retain its competitive edge.
According to reports, no layoffs have taken in place in UberEats and Uber freight units. Back in India, the reports were rife that the ride-giant was recently in talks with home grown foodtech major Swiggy to sell off its struggling UberEats India business. The step was widely seen as part of company’s efforts to cut down on its growing losses. However, the negotiation is reported to have been failed.
Since reporting record breaking loss of $5 Bn in Q2 2019, Uber is enduring tremendous pressure from its investors to streamline its losses and thereby cure its stressed balance sheet. The SoftBank backed company’s recent highly disappointing IPO launch has only further added to the pressure.
In its hey days, Uber was once the toast of global investors and the U.S. market was especially waiting for its IPO with bated breath. But the script started steadily changing after the ride-hailing giant started exiting from some of key markets as it failed to overcome the local competitors.